Customer Ownership Core Of Banking Cloud Initiatives

Technology can play a critical role in enabling financial inclusion for the migrant population as well as catering to the critical need for customer segmentation for the banks. In conversation with Biztech2.com, Robin Roy, Associate Director, Financial Services, PricewaterhouseCoopers explains how IT can play the facilitator in these areas. He also shares his thoughts around cloud nuances specific to the banking sector.

How can mobile banking come to the rescue of migrant population?

The migrant population in the city is becoming more mobile savvy. They earn elsewhere and remit the money back home, and therefore need to be introduced gradually to the use of mobile technology. Quite a few of them, when they work in urban areas, have access to a handset. If technology providers can come up with a low cost application, which can ride on the handset, they have access to people back home and the bank can act as an intermediary.

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What is the importance of customer segmentation for banks and how can IT assist that?

One needs to look at each customer segments a little differently. It’s very similar to how banks do it currently, following the Channel - Product matrix. So, online channels should be for certain targeted customers who would be more likely to use that channel than the other set of customers. After mapping the various customer profiles the required number of communication channels can then be targeted to different customer segments.

We should not forget that, in the ultimate analysis, the banks need to make money. So, whatever they invest today they need to get an instant return on that, which would be happening through proper customer segmentation. This is where technology plays a key role because IT tools not only enable to track patterns of transaction but also analyse those patterns and feed it to the marketing team. This is what BI and analytics is all about.

What are the nuances specific to the adoption of cloud computing in the BFSI sector?

For a country like India, which is so vast and distributed in terms of consumers as well as the various stakeholders involved in the financial services sector, cloud computing is an excellent concept. But, at the same time I would say that the fulcrum of whatever is done needs to be the consumer and who owns the consumer? On one hand, you cannot say that you will have life-cycle kind of products and you give away that ownership of the consumer, wherein somebody else is managing it, customer data is stored somewhere and the company loses all control of the data.

There are a host of issues around data privacy, security, etc. It is extremely difficult for a Cloud Service Provider (CSP) to assure the bank or any other entity of securing data privacy. We know for a fact that none of the cloud applications allow the client to monitor their security. This results in the lurking doubt whether confidentiality is maintained.

Fundamentally, there are three things that are critical - firstly data, secondly if you are losing control of the customer (from the bank’s perspective) and thirdly, you need to check whether the costs are coming down significantly, and if they are not, then you need to re-visit and perhaps debate this out.

What are the areas where it can help the banks?

Today a lot of financial products are simple and commoditised. So, if you want to do a market launch of a product all across the country, you don’t need to use your own hardware and software internally. The cloud computing model can be used to manage that. The DR initiative can also be done using the cloud platform.